The jobs market continues to show signs it is turning around as weekly claims fell again last week. Initial claims for unemployment dropped 12,000 to 367,000 according to the Labor Department. The week before saw claims revised slightly higher to 379,000 from 377,000. Jobless claims have held below 400,000 for 8 of the last 10 weeks, below a level typically used as a sign of an improving jobs market.
Economists were expecting a very slight drop to 375,000 last week. The four week moving average for jobless claims, which is used to smooth out volatility, fell to 375,750.
The jobs market has seen momentum in the past few months with the unemployment rate dropping to 8.5% in December. One thing to remember though is that when someone stops looking for a job because they have been unemployed for so long they are no longer counted.
The jobs market has a long way to go though as 23.7 million Americans are either unemployed or underemployed. Last week, the Federal Reserve acknowledged the improvement in the jobs market, but said the jobless rate is still too high. They will likely keep overnight lending rates near zero through at least 2014.
Productivity saw an increase, but was lower than expected. It increased at an annual rate of 0.7%, economists were expecting it to grow at 0.8%.
The Dow is trading flat right now despite the positive news from the jobs market. The Dow is up 8 points right now, the Nasdaq is up 13 points and the S&P 500 is up 3 points.